Some interesting statements, comments and facts in the annual report.
1. Chairman opens by discussing the resignation of JW. Quote:
"It wasn't an easy transition - In my experience, it never is - but we had particular problems leading to parting company with the managing director."
Interesting comment to start with and interesting to note that nothing more was said.
2. Cash flow is the only factor determining the ongoing concern of AAM. Should I repeat that statement or should I say 'derrr - that is business!!!!'
Imagine if cashflow for a start up producer was not important for being an ongoing basis. Such an operation would either be in long term debt, have lots of shares on issue, be hedged, have a combination of the aforementioned or got real lucky.
Am I concerned as a shareholder? Of course I am. As much as I am concerned about my own business and its cashflow!!!!
3. Changes in the Top 20 in the last 2 months
Mr John Colton down 71,000 shares JP Morgan Nominees up AT LEAST 1.5 million shares (outside top 20) new entrant and possibly new holder HSCB Custody Nominees down 400,000 shares ANZ Nominees down AT LEAST 1.1 million shares (outside top 20) probably exited Citicorp Nominees up at least 100,000 share (outside top 20) new entrant and possibly new holder Mr Everitt George Brown up at least 40,000 shares new entrant and possibly new holder
Two holders listed on the August Top 20 do not appear on the October Top 20. These are:
NEFCO Nominees and Commsec Nominees.
Their holdings as of August did not make them eligible for inclusion in the October Top 20. They could have sold out or they simply have done nothing. One thing is for sure, they have not purchased.
4. Narnoo tenements HAVE DEFINITELY GONE!!!!!! Interesting circumstances surround their loss imo. Should shareholders question the loss of these tenements and their circumstances? Do shareholders have any recourse? (shareholder civil action???) It would seem there are 'conflicting views' on the value of the Narnoo tenements if you were to read the scant AAM announcements during their release and the St George prospectus.
SUMMARY
New leaf has been turned.
Past performance is no measure for future performance.
We are cash flow positive or at least neutral.
Costs have been curtailed and near term production will be augmented by reduced costs.
Unless something happens to the plants capability to produce cash flow there is no reason to believe that AAM is on a downward spiral.
PERSONAL COMMENTS
Should an emergency cap raising be required I WILL support it. In the meantime I will hang onto my cash reserves for such a possibility.
GC
GC
AAM Price at posting:
11.0¢ Sentiment: LT Buy Disclosure: Held
